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Report Points to Aquaculture as Key to Greece's Economic Growth

30 August 2012

GREECE - The aquaculture sector has been identified as a rising star of the Greek economy, according to McKinsey & Company business consultants, with considerable potential which could provide a healthy boost to the country’s gross domestic product.

The report, presented earlier this month, showed that fish farming in Greece is set to see a €1 billion increase in its gross added value over the next decade, leading to a 184 per cent, or €782-million, rise in the value of Greek exports, which would reduce the current account deficit by €700 million, reports
Ekathimerini.

The survey, produced on behalf of the Hellenic Federation of Enterprises (SEV) and the Hellenic Bank Association (HBA), also suggested that fish farming can help rekindle job growth by creating 20,000 new positions from the expansion of the domain in this country in the coming decade.

For this growth to materialise, however, the sector will need a number of interventions on a business and regulatory level, McKinsey stressed. Firstly, although Greek products are broadly seen to be of high quality, the absence of processing reduces their added value to a considerable extent. Some 95 per cent of sea bass and bream production is exported without having undergone any processing, e.g. packaging, so that it could be directly forwarded to supermarkets for retailing or as part of ready meals. The study suggested that this shortcoming could be corrected via the strategic cooperation of firms within the sector, possibly leading to a degree of vertical integration, and via the creation of quality stamps, with the state’s assistance.

The other major problem, according to firms in the sector, is insufficient legislation concerning the location of installations. Although last year Greece came up with a special zoning plan for fish farms, this actually appears to be hampering the sector’s growth. At the same time, according to the study, Turkey, which is evolving into Greece’s biggest competitor, has been rapidly improving its regulatory framework so that in the coming years its sea bass and bream output will exceed that of Greece.

McKinsey argues that Greek fish could find more buyers abroad, for example through cooperation with diaspora firms in the US, while Japan and China could be targeted as export markets too.